19930615 CC SR Loan Agreement between City and RDA FY 1992-93 2111
ekrtj
-M)
MEMORANDUM RANCHO PALOS VERDES _
AMA' FED
of the CityCouncil CITY COUNCIL
TO: Mayor and Members *„OO PM vvieors
Ycmr or
FROM: Director of Finance, Brent D. Mattingly JUN 1 c 70Q3
DATE; June 15, 1993
'
SUBJEC T�: Loan Agreement between City and RDA - FY 1992- CITY CLERK
RECOMMENDATION:
Authorize the Mayor and City Clerk to execute the attached Loan
Agreement between the City and the Rancho Palos Verdes
Redevelopment Agency to fund Redevelopment Agency activities in
fiscal year 1993-94 for the Portuguese Bend RDA Fund. The proposed
loan will fund RDA activities in the amount of $133, 000 in FY 1993-
94 .
BACKGROUND:
On January 29, 1991, the RDA Board entered into a loan agreement
with the City of Rancho Palos Verdes to fund RDA activities in the
Redevelopment area. This agreement states that the loan shall
mature concurrent with the close of the fiscal year. The purpose of
this maturity date is so that the loan may be updated on an annual
basis to consolidate loans in previous years with any repayments or
additional loans.
On July 25, 1991, the County of Los Angeles issued $10 million in
County Improvement District Bonds as part of the Horan Settlement.
A portion of these funds are available to fund activities in
Abalone Cove. However, in the case of Portuguese Bend, the RDA does
not currently have the resources to fund necessary projects;
therefore, loans from the City are necessary.
In past loan agreements with the Portuguese Bend fund the interest
rate charged by the City was ten percent. Staff recommends that the
interest rate be revised to equal the rate earned by the City on
its LAIF deposits plus three percent. Currently, this would yield
an interest rate of approximately 7. 64%. The attached loan
agreement includes the revised interest rate provision for future
interest calculations.
The details on the two separate RDA funds and the City loans made
to them are as follows:
Portuguese Bend Fund
As approved in the adopted fiscal year 1992-93 City budget,
a
$133 , 000 has been transferred to the RDA. The attached loan
agreement incorporates all previous loans made by the City to the
RDA's Portuguese Bend Fund into one loan agreement, and includes
the additional $133, 000 proposed to be loaned to the RDA for FY 93-
94.
3-
94. The total principal amount loaned to the Portuguese Bend Fund
through June 30, 1993, shall be $1,895, 552 . With accrued interest
of $544, 394 the total amount owed by the Portuguese Bend Fund is
$2 ,439, 946.
Abalone Cove
As of June 30, 1992 all loans from the City to the Redevelopment
Agency have been repaid.
Respectfully Submitted, Reviewed:
Q
Brent D. Mattingly Paul D. ussey
Director of Finance City Manager
Attachments: Loan Agreement for fiscal year 1993-94
c:\data\wp51\resol\loan93.rda